[Exclusive] "40,000 Won Per Day for Hospitalization Due to COVID-19"... Insurance Product Launched

'COVID-19 Endemic' Insurance Industry Response

[Image source=Yonhap News]

[Asia Economy Reporter Oh Hyung-gil] As the COVID-19 pandemic is expected to transition into an endemic (periodic outbreak), the insurance industry has introduced special riders that provide coverage for infectious diseases including COVID-19. It has become possible to design insurance plans that pay up to 400,000 KRW per day for hospitalization due to COVID-19.

According to the insurance industry on the 19th, Hyundai Marine & Fire Insurance launched a specific infectious disease daily allowance rider starting this month. This rider provides 50,000 KRW per day, up to a maximum of 1.5 million KRW over 30 days, for hospitalization due to infectious diseases such as COVID-19, Middle East Respiratory Syndrome (MERS), Severe Acute Respiratory Syndrome (SARS), cholera, and typhoid fever.

This is the first time a rider guaranteeing daily hospitalization allowance for such infectious diseases has been introduced. Carrot General Insurance had previously offered a short-term disease protection insurance rider covering COVID-19, but it was sold for only two weeks before being discontinued.

The premium for Hyundai Marine & Fire Insurance’s specific infectious disease hospitalization rider is up to 80 KRW per month, but it must be purchased together with a main contract such as comprehensive insurance, children’s insurance, or driver insurance, which typically cost between 10,000 and 20,000 KRW.

One advantage is that if you additionally subscribe to a disease hospitalization daily allowance rider, you can receive overlapping coverage. You can also add daily allowance riders for general hospitals (up to 10 days) and intensive care units (up to 180 days), which offer relatively higher coverage amounts and periods.

According to statistics released by the Disease Control Headquarters, the average hospitalization period for COVID-19 patients is 15 days for mild cases, 18.4 days for moderate cases, and 77.4 days for severe cases. Considering this, if hospitalized in a general hospital ICU for more than 70 days, one could receive a daily allowance totaling over 20 million KRW.

Most insurers pay the same daily hospitalization allowance not only to hospital patients but also to those admitted to residential treatment centers. Initially, non-life insurers debated whether to consider residential treatment centers as hospitals, but after the COVID-19 outbreak in Daegu led to a shortage of medical facilities and medical care was provided at residential treatment centers, they tentatively decided to guarantee daily hospitalization allowances.

Treatment costs for COVID-19 are fully covered by the government, and private insurance does not cover medical expenses. However, in the event of death due to COVID-19, both life insurers and non-life insurers pay death benefits.

The insurance industry expects that as the COVID-19 situation prolongs, new coverage riders such as daily hospitalization allowances will continue to be introduced for the time being.

A non-life insurance industry official said, "Most riders with specific coverage are introduced for a limited sales period, but as the COVID-19 situation continues, various riders may be launched," and advised, "If hospitalized due to COVID-19, it is recommended to check whether your existing insurance provides daily hospitalization allowance coverage."